The Minister for Health and Children has instructed the HSE to implement a new contract for community pharmacists in just over two weeks. This has caused much anxiety among people who use the GMS system, who number well over 1 million and are among the most vulnerable in our society, that they will not be able to obtain their medicines after 1 March. There is currently a stand-off between the HSE and the pharmacists. At yesterday's five hour meeting of the Joint Committee on Health and Children, which is to resume this morning, it was made perfectly clear by the representatives of the HSE that they had been instructed by the Minister for Health and Children to implement this new contract by 1 March.

What contingency plans does the Taoiseach have to ensure that substantial numbers of elderly and vulnerable people and children who avail of medical cards will be able to obtain their medicines after 1 March if this stand-off continues? This is causing considerable stress to many people. This party does not condone any precipitate action, either by the pharmacists or by the HSE, that will reduce the level of services. What are the Taoiseach's contingency plans after 1 March?

I acknowledge the meetings of the Joint Committee on Health and Children that have taken place yesterday and today. The committee has done its best to tease out the issues. I should point out that if any community pharmacists decide not to honour their contracts they must give three months notice. No pharmacy in the Republic, to the best of my knowledge, has provided such notice. Thus, the issue should not arise. I note Deputy Kenny's point that there should not be any precipitate action, which means that pharmacists should not break their contracts. That is the position.

The Shipsey dialogue process was established by the HSE to address the concerns of the Irish Pharmaceutical Union, on behalf of community pharmacists, about the implications of the legal advice on competition law and the right of the IPU to negotiate margins on medicines. That has continued for the last few months. We discussed it here last autumn. At a meeting on 5 December 2007 under the auspices of Mr. Shipsey, a two-stage process was offered to the IPU by the HSE. The first stage was to address the immediate concerns of the IPU regarding the alleged impact of the proposed revised wholesale arrangements on GMS-dependent pharmacists — the ones mentioned by Deputy Kenny — while the other was to provide a basis upon which discussions on a new substantive contract could commence. As the IPU rejected this offer, the HSE proceeded to offer a draft interim contract to address the main concerns regarding the alleged impact of the proposals. As Deputies we have all heard from pharmacists about how this will affect them. The details of the draft interim contract and the HSE's other intentions in this regard were set out in letters to individual community pharmacists after Christmas and into the new year.

I understand the HSE now intends to implement revised arrangements on 1 March and that it also intends to enter discussions with the IPU on the development of a new substantive pharmacy contract as soon as possible. The Minister is working to develop appropriate arrangements for the deployment of the contracts and for the setting of fees. These arrangements may include the establishment of an independent body which would consider the nature of the service to be provided and all other relevant factors in each case——

Before March?

——and make recommendations to Government on the fees it considers appropriate. Many Members have asked how it would work, but its terms of reference and the timescale for its work are among the matters to be discussed. I can inform the House, because I know all Deputies are interested in this, that the Minister is anxious that the process to enable the development of new contractual arrangements for the delivery of general practitioner, dental and community pharmaceutical services be put in place as soon as possible. Consultations are continuing with all relevant stakeholders with a view to establishing these arrangements.

Will it happen before March?

It will happen as soon as possible.

It is a pity the Minister was not as direct about the intention of introducing savings by reducing the administrative bulge in the HSE, which has been recognised by the Taoiseach.

The Taoiseach has not answered my question about his contingency plans for the provision of medicines to people all over the country in the event of a withdrawal from the GMS by community pharmacists after 1 March. This is exercising the minds of people in the Taoiseach's own party as well as every other party. I recognise that it is important that savings be introduced. If the HSE and the Minister for Health and Children are so confident of the irrefutability of their figures they should not have anything to fear from arbitration. I commend the actions of Minister for Transport, Deputy Noel Dempsey, in appointing an arbitrator to deal with the broken promise about Cork Airport. Independent arbitrators have been appointed all over the place. This is a matter of genuine concern——

Hear, hear.

——to ordinary people who want to be assured they will be able to obtain their medicines.

They are sitting behind the Taoiseach.

Pharmacists are well able to stand on their own two feet and will approach this argument in a mature fashion. If the Taoiseach and the Minister are so sure of their figures, they should not have anything to fear from arbitration.

At yesterday's committee meeting it was made perfectly clear that the Indecon report, commissioned by the HSE, stated that there should not be any precipitate action. Although the Taoiseach says that the draft interim contract is to be implemented on 1 March, the committee was told yesterday that this was a voluntary interim contract but that the changes at stake would still be implemented by the HSE.

I ask the Taoiseach again what contingency arrangements are in place. Second, in order to bring some sanity and common sense to this stand-off, will the Taoiseach agree to the appointment of an independent arbitrator to consider how a reduction in costs can be achieved without affecting the delivery of services to people throughout the country? This process should be put off until such time as a competent arbitrator can make a recommendation — within a month, six weeks, two months or whatever date the Taoiseach decides.

When the committee and the HSE were questioned yesterday, they said that if the Minister was to say that she wanted this put back until 1 May, they would follow that direction. The same thing happened when she intended to introduce the long stay health institutions Bill on 1 January. When the Government recognised that there was a problem, it put back the introduction and implementation of that Bill and we still have not seen it. If there is a problem, it should be dealt with.

It is now two weeks and the clock is ticking in a situation where hundreds of thousands of people are concerned and anxious. In many cases, it is causing stress to elderly people because they fear they will not be able to get their medicines and prescribed drugs when they need them. There is a problem and a stand-off. The Taoiseach can deal with it by appointing an independent arbitrator and giving that person six weeks or two months to deal with it. If that happens, I am quite sure the matter can be resolved so that savings can be introduced without any disruption to the quality of the service that has been available for so many years to hundreds of thousands of people through community pharmacies. What are the Government's contingency plans and will the Taoiseach direct that an independent arbitrator be appointed?

A number of points have been made. In respect of the main point made by Deputy Kenny, the HSE had contracts with 1,600 pharmacists. If anybody wishes to break from this contract, he or she must give three months notice. That is the legal fixed position. In respect of interim arrangements, if nobody has declined the contract, that is the position. As Deputy Kenny stated, people should not take precipitative action. I do not want them to do that either.

The Department of Health and Children understands that preliminary interests have been expressed by pharmacy chains and individual pharmacies in the new interim contract offered by the HSE. However, definitive information on possible take-up is not available from the HSE. A preliminary meeting was held recently between the HSE and the Irish Pharmaceutical Union to discuss the contractual matters.

In respect of pricing, I understand that we deferred it. Deputies Kenny and Gilmore raised the matter in October and November and we took an active interest in it at that stage. I understand that it was deferred on 1 November.

Nothing happened.

The crux of the matter is that the wholesale margin in this country is more than double that found in any other country in Europe, including Northern Ireland. We must work to find a solution, which we have been doing. It is an enormous margin. I will not get into the side issue. This is simply a statement of fact. The Minister wants to agree a contract, which must be done. I said again this morning that the Minister is working to develop appropriate arrangements for the development of contracts and the setting of the fees payable.

The issue relates to the fees. Pharmacists have put their case to me, as they have done to every Deputy in this House. They are entitled to do so and have put their case well. The Minister said, and I repeat, that these arrangements may include the establishment of an independent body which would consider the nature of the service to be provided and all other relevant factors in each case and make recommendations to the Government in respect of the fees it considers appropriate. The composition of such a body, its terms of reference and the timescale for its work are among the matters to be considered in this regard.

I believe Deputy Kenny would agree with me that rather than us scaring and upsetting a large number of people, particularly older people, it would be reasonable for the sides to agree the contract. Based on the cases I have heard from individual pharmacists, I understand that the main issue that divides them is the fees element. The Minister has said that only then could we involve an independent arbitrator or body who would examine the fees issue. That does not seem to be an unreasonable position.

Will the Government do that?

I urge the sides to lower the temperature, agree the contract and then allow the Minister to look at the fees element. I am only stating a fact. I am not trying to upset——

Cart before the horse.

It is not a case of putting the cart before the horse.

It is not a case of putting the cart before the horse. One cannot negotiate a fee with somebody if one has no arrangement. Let us not be unreasonable about this. It does not seem an unreasonable position for the sides to take and they should consider it.

Why not appoint an arbitrator now?